So, if you are growing 100% year over year, you can lose money at a rate of 60% of your revenues

If you are growing 40% year over year, you should be breaking even

If you are growing 20% year over year, you should have 20% operating margins

If you are not growing, you should have 40% operating margins

If your business is declining 10% year over year, you should have 50% operating margins

I have never seen growth and profitability so nicely tied together in a simple rule like this. I’ve always felt intuitively that it’s OK to lose money if you are growing fast, and you must make money and increasing amounts of it as your growth slows. Now there’s a formula for that instinct. And I like that very much.